Standard Life warns key markets will 'remain difficult' as UK sales fall 20%

Click to follow
The Independent Online

Standard Life's sales in the final quarter of last year fell by 20 per cent in the UK, the insurer said yesterday, warning that some of its key markets would "remain difficult" in 2008.

The figures represent another blow for Standard, which on Tuesday announced that its highly rated head of UK retail, Trevor Matthews, was quitting to become chief executive of the rival insurer Friends Provident.

However, Sandy Crombie, the insurer's chief executive, said that, overall, 2007 had been a good year, with total worldwide life and pension sales up 12 per cent, including a 15 per cent gain in the UK. Mr Crombie said: "The group's performance in 2007 was good, consolidating the strong progress in recent years."

Nevertheless, Standard shares fell 4p to 228p, below the 230p at which the company demutualised in July 2006 and more than a third down on the high point of 349.5p reached last summer.

Youssef Ziai, an insurance analyst at ABN Amro, said Standard was still getting over its failed attempt to take over Resolution last year. "Having failed in its desired acquisition, management has clearly signalled that the group needs to do a deal to improve its cash position and to transform itself into a higher-margin business."

Barrie Cornes, an analyst at Panmure Gordon, called the results "disappointing" and warned a 16 per cent fall in the sales of self-invested personal pensions (Sipps), a flagship product for Standard, was particularly worrying. "The reason for the slip in Sipp sales appears to be a combination of factors including high commission being paid to independent financial advisers by other providers to sell traditional personal pensions."

Yesterday, Mr Crombie said Mr Matthews' departure, which overshadowed Standard's new business figures, had taken him by surprise and he had yet to decide how to replace him.

Friends Provident, which Mr Matthews will not be able to join until the summer, is due to announce the results of a strategic review today.